DeVere stops providing transfer value reports in response to FCA concerns
The UK arm of the deVere Group has agreed to discontinue providing third-party entities with transfer value analysis reports, in response to concerns by the Financial Conduct Authority, amid a climate in UK regulatory circles in which pension transfers are increasingly being drawn into question.
The FCA has also made deVere the subject of a so-called Section 166 notice, which means that it is currently being investigated on specific, unidentified issues, as a UK-regulated entity by a “skilled person”.
A deVere spokesperson said deVere UK said the company agreed to discontinue providing the transfer value analysis reports (TVAs) following a meeting with the FCA, and that no clients had complained nor, to deVere’s knowledge, been detrimentally affected.
He also stressed that such TVAs as deVere had done had been for other deVere entities, not unrelated third parties.
The FCA said it has issued no formal statement on the matter, and that it doesn’t comment on individual firms.
The FCA’s action preventing deVere’s UK arm from providing transfer value analysis reports is contained in a single line of the FCA’s online register of regulated companies, which is accessible by the public. It notes that deVere and Partners (UK) Ltd must “immediately cease to provide third party companies with TVAs/DBAR [transfer value analysis/defined benefit analysis] reports or other similar report of information designed to assist third parties companies in transferring customers DB pensions to an alternative arrangement”.
There is no date on the stipulation, but an industry source familiar with the matter told International Investment it was recently added.
‘No advice to third party company’
A deVere spokesperson said deVere UK, in complying with the new FCA requirements with respect to transfer value analysis reports, had “worked with divisions within deVere in seeking to represent clients’ interests cross border”, and stressed that “no advice or information was provided to any other third party company”.
He added: “DeVere UK wrote directly to the FCA on this matter, and this resulted in a meeting. The firm, recognising the FCA wanted to strengthen procedures, entered into a voluntary requirement to cease providing advice in this arena.
“We continue to work alongside the FCA’s appointed independent body through the Section 166. As one of the sector’s leading providers of overseas pension transfers to international clients, we fully support and welcome this review.
We are confident that there has been no detriment to clients, and there have been no client complaints.
“Working with the FCA, we have taken decisive steps to ensure our clients’ best interests have been served.”
As reported here last month, the FCA has recently taken a firmer stance than previously with respect to pension transfers, warning in a statement that advisers could be held responsible for failing to spot pension scams or unsuitable investments, both onshore and in pensions being transferred abroad on which they advised.
In its warning, the regulator said it would “take action” if due diligence processes – both initial and ongoing – weren’t “robust”.
The FCA’s warning came in the wake of a spike in pension transfers last year, in part in response to new pension freedoms created by UK legislation aimed at giving people more control over their retirement pots. Critics have said that the new pension freedoms also enabled pension scammers to take advantage of more people than ever.